Final Accouting Project

AcknowledgmentFirst of all we thank to our humble gratitude to Allah Almighty The most Gracious and the most Merciful, who gave us strength and enabled us to achieve our goals.

Our deepest thanks to Lecturer,Mr. Ahmed Arif Thanks for his Guide in the project with attention and care. He has taken pain to go through the project and make necessary correction as and when needed. The main purpose of the project is to know about the Practical implementation of all the concepts we studied in principles of accounting. All the material that has been included in this report is based on data/information gathered from Midas Communications (Pvt) Ltd; and is based on certain assumptions. We are highly thankful to the valuable suggestions, comments and skillful thoughts given by the concerned authorities of Midas Communications (Pvt) Ltd; for the achievement of our goal.AbstractIntroduction & History:Midas Group was nestled in Lahore 30 years back, by Mr Ghulam Akbar, with innovation to harbor ideas. It is Pakistans biggest in-house Audio-visual/TV productions facility offering comprehensive electronic media solutions and is also Pakistans top-notch agency in advertising, public relations and a/v production. Incorporated in 1981, Midas Pvt Ltd is part of a consortium comprising of Midas Private Limited.

Information Services (Pvt) Ltd.

Midas Entertainment (Pvt) Ltd.

Midas Productions (Pvt) Ltd.

Midas Software (Pvt) Ltd.

Midas Out of Home (Pvt) Ltd.

Since that time the company has grown to lead the market and became Pakistans top- notch agency in advertising, public relations and A/V Production. The company was competent enough to have earned APNS accreditation within a year of inception and won major advertising awards for 22 consecutive years. Now MIDAS private has established a nationwide network with offices in Peshawar, Karachi and Islamabad, Lahore and Quetta.

Name:Midas is an appropriate name which means Golden which collaborates with the companys long term vision of providing the golden touch to its clients products or corporations and is also short and easily memorable.

Vision:

Give us a product and we shall give you the Golden Touch

Mission statement:

To facilitate our clients by making people aware of their presence and to discover newways to deliver value for each penny that they spend

ADVERTISING

Midas makes use of the traditional signature advertising on the artwork space in a print advertisement in newspapers by writing the name of the company at the bottom of the ADplaced in the newspaper, mostly when the advertisement is of a dominant company about which most of the people are aware off.Product

Midas Pvt. Ltd. Basically offers the following two types of services:

Artistic Designs for print media, including newspaper ads. Audio and Visual advertisements, including television as well as radio ads.Pricing

Pricing is a major factor that greatly influences and determines the success and failure of aproduct. Midas follows the prices assigned by the All Pakistan Newspaper Society (APNS) and Pakistan Broadcasters Association (PBA). APNS sets the prices for the ads which arepublished in the new papers according to the size of the Ad. PBA sets the prices for the audio and visual ads according to the time slots specified by the client e.g., high price is charged for showing the commercial between 5 pm to 7 pm and 9 pm to 11 pm from which15% of the share in profit is kept by Midas and rest is of the 85% is given to PBA.

Placement

Midas Corporation Establisheda nation-wide network in the federal as well as fourprovincial capitals of Pakistan. Where the offices of the company reside in

Islamabad Lahore Karachi Peshawar

ThreatsThe only threat that Midas faces is the presence of other emerging advertising companies int he market to gain more and more market share and steal more and more clients. Midas corporation faces a lot of competition from many big and small companies throughout Pakistan yet the major competitors are as follows,

Orient Advertising Pakistan

Interflow Communications Ideas workshop

Ad group PVT limited

M communication PVT Ltd.Orient Advertising

Company, a major player in the market of Advertising since1953 much older than Midas and has established a lot of Goodwill and reputation in the market.

Interflow Communications,

It is established in 1983 and has also been one of the pioneers of marketing communication services in Pakistan and a serious competitor of Midas Group.

Customers and competitors:

Customers:

FrequencyNameCities

DailyDawnKarachi, Lahore, Islamabad

DailyDinKarachi, Lahore, Islamabad

MonthlyEconomic OutlookKarachi

DailyJangRawalpindi, Karachi, Quetta, Lahore

DailyKhabrainKarachi. Lahore, Multan, Muzaffarabad, Islambad

DailyNawa-I-WaqtLahore, Mutan, Karachi, Islamabad

MonthlyOverseas InternationalIslamabad

DailyPakistan ObserverIslamabad

MonthlyRohani DigestKarachi

MonthlySheKarachi

MonthlyShuaaKarachi

DailyThe FinanceKarachi

DailyThe NationIslamabad, Lahore

DailyThe NewsKarachi, Lahore, Rawalpindi

Hierarchy:Management compensation:

Director: 80 thousand to 2 lakh

Manager: 30 thousand to 80 thousandSub ordinates: 10 thousand to 25 thousand

Extra information:Midas Private Limited has the Following Strengths that support the company internally and help in opting to various opportunities in the market.

Company has won awards in major creative and business awards for 22 consecutive years. They have two agreement related to print and electronic media APNS and PBA. APNS Client Performance Award, 2001 APNS Special Business Performance Award, 2001 3 Decades of Experience in the field of Advertising. It is also biggest company of Pakistan in-house Audio-Video production facility. Business developerInformation about different department of company:Creative department decide about working of add and they just think about add and give unique ideas about advertisement. Art department decide about coloring, sound effects and graphic of add. Media department generate invoices.Q.A manager maintain the file of chief operating officer.H.R is m mediator between COO and other department of company and also tells the decision of CO to other department.H.R manager decide the hiring of the employees and update their C.V.client service manager do some impotent tasks. Firstly client comes to the management department for advertisement of product, then client tell his budget to management department, then pass this task to media department. Media department generate invoices, then pass it to the creative department then transfer it to the production department. Production department decide location and then start shooting on add, after making add then it given to marketing department. Marketing department convert this add to the C.V, DVD and give this add to the newspaper, radio and TV. After published every add bill comes to the finance department. Finance department check bill and reconcile bank statement with own statement. And also check and match balances of bills and inviocesStructure of accounting department:Members in accounting department:

There are 4 members in accounting departments. Names are given bellow

Chief Accountant:

Mr. Wasif ShahidManger Finance:

Mr. Masroor ShahManger Accountant:

Mr. M, KamranAccountant Executive: MS. Sobia NaveedResponsibilities:The working procedure of chief accountant is delay the check of customer for certain time and how urgently received check from client. The responsibility of chief accountant is maintaining the good will of company.

Manger finance only thinks where to do investment, how to hold money and coordinate with the boss.

Manager accountant check the invoices and bills and if there is any fluctuation between any amount of invoices and bill he can balance it and if any client doesnt give money he can write letter.

Account executive maintain patty cash book and keep a proper check out of all petty expenses Business strategy:

Company starts business without any advance. They do their own investment.Source of accounting information:Invoices and bills are source of information.

Report on accounting process:Accounting procedure:

First of all research is conducted on the product of the client by the Client Service DepartmentClient Service Department:

This provides with the basic knowledge of what the product is, theirdistinctive characteristic, how it may fulfill consumer needs. All this information is necessary for the company in order to create an ad that will induce people to purchase the product. To help Midas create such effective ads, Aftab Associates and NNINews help conduct all the researches.

After receiving briefing from the client and doing some research about the product, internal briefing is given to the Creative DepartmentCreative Department

This department then creates alternatives and selects amongst them the suitable brand name for the product and an appropriate logo designed along with an appealing tagline, URLs etc. A popular brand ambassador is also selected in order to attract more customers. Later a media strategy is also selected for the promotion the product which could be the in the form of a newspaper product or a television commercial etc.

After selecting amongst the several alternatives, a suitable proposal is made for the client to show him the plan regarding the advertisement of their product and do the necessary alterations, if any, suggested by the client.EVENTS & EXPERIENCESSales

The company sells there services by giving different advertisements in the newspapers orAudio-Visual media, that also show what services do they avail and how can you contact the company for further information. A person can either come in contact with the company by email, telephone or even an address is given where they will be given proper and complete details of what can be done for their specific job whether they want to make advertisement orads in newspaper they can discuss it thoroughly. The company makes three different advertisement every time for each individuals job , than the person to whom the company makes the advertisement is called and all of the advertisements are shown to whom , ofcourse those three are selected from a lot of different approaches that different workers have used , than in those three one is selected by the person who wanted it in the first place and then the process goes accordingly, if the person doesnt likes even one in those 3 than the company gives the owner further time and tries to come up with something according to the need of the person where they try their very best so that they arent denied for the second time , but most of the jobs are completed in the first time because of the trained professionals that work on them and because the 3 best are shown to the person , and then rest Is up topersons perceptions and psyche.Reasons ofSuccess

The major reason for the success of the company is that the company has a variety of skilled experts working as its employee along with the companies 30 year experience in the field ofAdvertising. Another major reason for the success of the company is that the officials ofMidas are associated with many research partners such as Aftab Associates and its unique association with many online and NNI news agencies sue to which the company always remains aware of the market trends and plan accordingly. Also Midas was the first to establish Pakistans biggest in-house audio-visual production facility offering comprehensive electronic media solutions and the company has state of the art computer hardware and software and the most important ability of the company is to deliver commercials, documentaries and jingles at short notice and live coverage from anywhere in Pakistan.MIDAS COMMUNICATIONS (PVT) LTD

BALANCE SHEET

AS ON MAY 31, 2012

ASSETS

Cash800000

Prepaid insurance502000

Accounts receivables600000

Furniture480000

Accumulated depreciation furniture46400

433600

Building900000

Accumulated depreciation building43000

857000

Computer equipment360000

Accumulated depreciation computer equipment58000

302000

Production equipment5800000

Accumulated depreciation production equipment180000

5620000

Advertising boards200000

Media centers1050000

TOTAL ASSETS10364600

LIABILITIES+ O.E

Taxes payable28000

Accounts payables960000

Long term notes payable7403000

Bank loan668000

TOTAL LIABILITIES9059000

Unearned revenue280000

Capital1025600

TOTAL LIABILITIES AND O.E10364600

MIDAS COMMUNICATION (PVT) LTD

Unadjusted General journalDateDescriptionDebitCredit

Jun-12

1stCash7500

Account receivables7500

Received cash on accounts

2ndPrepaid rent 4000

Cash4000

Paid rent of building in advance

3rdCash39000

Revenue earned39000

Cash received from the news daily for giving services

4thBank loan14000

Interest expense1400

Cash15400

Paid bank loan @ 10% interest

5hMedia center26700

Cash 6700

Account payable20000

Purchased new building for media center

6thPrepaid printing expense3200

Cash3200

Paid cash in advance to printing shop

6thUtility expense2760

Cash2760

Paid utilities charges

7thCash 72900

Revenue earned72900

Gave service to daily dawn on cash

8thFurniture7700

Cash7700

Purchased new furniture on cash

9thAdvertising board47847

Long term note payable47847

Purchased new advertising board by signing long term note

10thCash50000

Capital shares50000

Invested new money by issuing shares

11thRepair expense4780

Cash4780

Paid cash for computer repair

12thCash 68700

Revenue earned68700

SHE paid cash as on completion of their advertisement

13thCash21200

Revenue earned21200

Received money from the DAWN on adverting their ads

14thPrepaid salary57800

Cash57800

Paid salary in advance

15thCash4400

Revenue earned4400

Gave service to Khawatein digest and collected money

16thAccount payable14000

Cash14000

Paid cash to settle accounts payable

17thCash14100

Bank loan14100

Lend money from bank @ 10% interest rate

18thPrepaid printing expense2120

Cash2120

Prepaid printing expenses

19thCash38300

Account receivables38300

Received money from DAWN on its account receivable

20thTax payable14000

Cash14000

Paid tax to settle tax account

21stCash17438

Revenue earned17438

NAWA-I-WAQT paid for posting ads

22ndCash14441


She paid cash in advance for their advertisement

23rdAccount receivables44840

Revenue earned44840

Gave services to business recorder on credit

24thAdvertising expense7860

Cash7860

Paid cash to united to-let services for posting ads

25thComputer equipment28770

Cash28770

Purchased new computer equipment for office use

26thUtility expense2000

Cash2000

Paid for utilities expense

27thPrinting expense7200

Cash7200

Paid cash for printing office cards

28thCash 4440

Revenue earned4440

Gave services to economic outlook and collected cash

29thCash49000


Received cash from Pakistan Observer in advance

30thAccount receivables22000

Revenue earned22000

Gave services to Business Recorder on credit

714396714396

MIDAS COMMUNICATION (PVT) LTD

GENERAL LEGDERS

MIDAS COMMUNICATIONS (PVT) LTD

UNADJUSTED TRAIL BALANCE

FOR JUNE 2012

SR.NODescriptionDebitCredit

1Cash1058129

2Account receivables621040

3Prepaid insurance502000

4Prepaid printing expenses5320

5Prepaid rent4000

6Prepaid salary57800

7Furniture487700

8Building900000

9Computer equipment388770

10Production equipment5800000

11Media center1076700

12Advertising boards247847

13Accumulated depreciation building43000

14Accumulated depreciation furniture46400

15Accumulated depreciation computer equipment58000

16Accumulated depreciation production equipment180000

17Tax payable14000

18Account payable973700

19Bank loan695400

20Long-term note payable7450847

21Unearned revenue412141

22Earned revenue8461618

23Capital1050000

24Depreciation expense building43000

25Depreciation expense furniture46400

26Depreciation expense computer equipment58000

27Depreciation expense production equipment180000

28Advertising expense7860

29Interest expense1400

30Printing expense7200

31Utility expense4760

32Repair expense20780

33Transport expense 20000

34Telephone expense12000

35Miscellaneous expense6400

36Electricity expense8000

37Salary expense7820000

1938510619385106

ADJUSTED GENRAL JOURANAL

DateDescriptionDebitCredit

Jun-12


Accumulated depreciation building5383

Depreciated building


Accumulated depreciation furniture3867

Depreciated furniture


Accumulated depreciation computer equipment4833

Depreciated computer equipment


Accumulated depreciation production equipment15000

Depreciated production equipment

30Insurance expense50000

Prepaid insurance50000

Insurance of worth 50000 have expired


Interest payable4140

Interest on bank loan is to be paid @10%


Prepaid salary5000

Salaries of worth 5000 is expired


Electricity bill payable4780

Received bill of electricity but not yet paid


Telephone bill payable5220

Received bill of PTCL but not have been paid


Revenue earned12000

Provided services of worth 12000 to SHE magazine

110223110223

Depreciation expense building

DateDescriptionDebitCreditBalance

Opening balance53835383

30-jun-12Depreciated building538310766

Accumulated depreciation building



30-jun-12Depreciated building538310766

Depreciation expense furniture



30-jun-12Depreciated furniture38677734

Accumulated depreciation furniture



30-jun-12Depreciated furniture38677734

Depreciation expense computer equipment



30-jun-12Depreciated computer equipment48339666

Accumulated depreciation computer equipment



30-jun-12Depreciated computer equipment48339666

Depreciation expense production equipment



30-jun-12Depreciated production equipment1500030000

Accumulated depreciation production equipment



30-jun-12Depreciated production equipment1500030000

Insurance expense


30-jun-12Insurance of worth 50000 have expired5000050000

Prepaid insurance



30-jun-12Insurance of worth 50000 have expired50000452000

Interest expense



30-jun-12Interest on bank loan is to be paid @10%41405540

Interest payable


30-jun-12Interest on bank loan is to be paid @10%41404140

Salary expense



30-jun-12Salaries of worth 5000 is expired50007825000

Prepaid salary



30-jun-12Salaries of worth 5000 is expired500052800

Electricity expense



30-jun-12Received bill of electricity but not yet paid478012780

Electricity bill payable


Opening balance00

30-jun-12Received bill of electricity but not yet paid47804780

Telephone expense



30-jun-12Received bill of PTCL but not have been paid522017220

Telephone bill payable


30-jun-12Received bill of PTCL but not have been paid52205220

Unearned revenue



30-jun-12Provided services of worth 12000 to she magazine12000400141

Revenue earned



30-jun-12Provided services of worth 12000 to she magazine120008473618


ADJUSTED TRAIL BALNCE

FOR JUNE 2012

SR.NODescriptionDebitCredit

1Cash1058129

2Account receivables621040

3Prepaid insurance452000

4Prepaid printing expenses5320

5Prepaid rent4000

6Prepaid salary52800

7Furniture487700

8Building900000

9Computer equipment388770

10Production equipment5800000

11Media center1076700

12Advertising boards247847

13Accumulated depreciation building10766

14Accumulated depreciation furniture7734

15Accumulated depreciation computer equipment9666

16Accumulated depreciation production equipment30000

17Electricity bill payable4780

18Telephone bill payable5220

19Interest payable4140

20Tax payable14000

21Account payable973700

22Bank loan695400

23Long-term note payable7450847


25Earned revenue8473618

26Capital1050000





31Advertising expense7860


33Insurance expense50000

34Printing expense7200

35Utility expense4760

36Repair expense20780

37Transport expense 20000


39Miscellaneous expense6400



1913001219130012


INCOME STATEMENT

FOR YEAR ENDED 30 JUNE 2012

DescriptionAmountsTotal

Earned revenue8473618

Expenses:

Depreciation expense building10766

Depreciation expense furniture7734

Depreciation expense computer equipment9666

Depreciation expense production equipment30000

Advertising expense7860

Salary expense7825000

Insurance expense50000

Printing expense7200

Utility expense4760

Repair expense20780

Transport expense 20000

Telephone expense17220

Miscellaneous expense6400

Electricity expense12780

Total operating expenses8030166

EBIT (earning before interest and tax deduction)443452

Interest expense5540

Net. income437912


STATEMENTS OF CHANGES IN EQUITY

FOR YEAR ENDED 30 JUNE 2012

DetailsAmountsBalance

Opening capital1000000

Investments50000

Capital during year1050000

Net. income437912

Closing balances1487912

Users of accounting information:The users of accounting information are client and banks.

Internally:

In the company every department can use the accounting information.

Externally:

Client and bank can use this information.

How these users these use this information to make their decision?

Client:If client want to give company add he see your accounting information for their satisfaction

Bank:

If company wants loan bank use the accounting information to see their progress.

Final Accouting Project

Documents

Transcript of Final Accouting Project